Investment Thesis
Becle (BCCLF, CUERVO*:MM) is one of the oldest companies in Mexico and the largest tequila producer in the world with 24.4% of the global tequila market. Despite its market only growing at mid-single digits and the company losing market share, its EV/2019 EBITDA is now 25.6 times. Under the most optimistic scenario, there is only 2% upside to Becle’s 2025 fair value per share. Unfortunately, the market is placing overvaluing the company’s growth prospects.
There are concerns over capital allocation, as the company seems to be acquiring growth without regard for